LOMBARD, Ill.--(BUSINESS WIRE)--In a white paper released today, leading multifamily energy services
company American
Utility Management (AUM)explains how
multifamily property owners can reduce energy use and cut operating
costs by benchmarking utility usage against a qualified pool of
comparable properties. The white paper, which is now available
for download, shares the results of a benchmarking statistical study
conceived by AUM and conducted in collaboration with Georgia
Tech.

Using AUM’s data, Georgia Tech developed a mathematical algorithm which
compares and contrasts multifamily properties, ultimately allowing
owners to identify cost savings. The algorithm takes into account a wide
range of variables unique to this property class, including such nuances
as common space, size of swimming pools and other high-intensity energy
amenities, geography, climate, and even a property’s orientation to
direct sunlight.

“Until now, comparing multifamily properties in order to establish
benchmarks and identify best practices to reduce energy use was
impossible because of the complexity and differences between
properties,” says Michael
Miller, President and CEO of AUM. “Using AUM property information
and actual utility data, the researchers at Georgia Tech helped us to
create a way for owners to draw peer-to-peer comparisons between
properties, which give them deep insight into how they are operating
against standard. Benchmarking is a vital first step in reducing energy
and utility costs. We conducted this study to prove that there is an
effective way to create benchmarks that can be used to better manage
properties, reduce operating costs, enhance asset value, and increase
ROI, while reducing utility consumption and maintaining a greener
property.”

According to AUM, the multifamily industry spends over $53.5 billion a
year on energy. Additionally, the EPA reports that utility costs
represent the single largest controllable cost in an apartment
community—typically accounting for 25 to 35 percent. Moreover, reducing
energy use by 15 percent in a typical 250-unit master-metered community
will increase net operating income, and increase asset value by over $1
million (using a 6 percent capitalization rate).

“The joint study validates the AUM model for energy and water
benchmarking,” says Baabak
Ashuri, PhD, Director of the Economics of the Sustainable Built
Environment Lab in Georgia Tech’s School of Building Construction. “We
view it as a valid new voice that will have positive reverberations
throughout the multifamily sector, helping asset owners, managers, and
investors see stronger returns while increasing sustainability.”

Energy savings represent the greatest possible opportunity for
multifamily property owners to reduce costs at time of tremendous stress
in the real estate industry.

“The challenge to achieving cost savings has always been difficult when
comparing various types of multifamily properties in order to establish
operating benchmarks. This study shows that by using AUM technology we
now have the ability to develop peer-to-peer benchmarks that show where
multifamily properties can reduce operating costs,” says AUM’s Miller.

The study used Data Envelopment Analysis (DEA) methodology to develop a
benchmarking model for energy and water efficiency. Properties in the
population are relatively ranked in this benchmarking approach and each
property receives a relative efficiency score, with the most
energy-efficient receiving 100 percent as their relative efficiency
score. The scores of remaining properties are specified in direct
comparison with respective peer properties with scores of 100 percent to
determine sustainability.

“This study provides strong evidence that the multifamily industry can
do much to reduce energy and utility consumption, which simultaneously
improves sustainability while driving down costs, and ultimately saving
money for both owners and residents,” continues Miller.

The company used this information in the development and implementation
of AUMScore,
a multifamily energy benchmarking tool that will enable property owners
to compare their properties’ energy usage across their own portfolios
and across the multifamily industry. The tool helps owners drastically
reduce their energy expenses and consumption by benchmarking energy use
within a portfolio using continuously updated information from similar
peer properties.

For more information on AUMScore or for a copy of the white paper,
contact Leigh Sperun at leigh@gregoryfca.com
or at (610) 228-2108.

About American Utility Management

Founded in 1994, American Utility Management (AUM) provides
comprehensive energy services to the multifamily industry. The company
prides itself on driving bottom line savings for its clients through its
energy management, invoice processing, and resident services. AUM uses
its proprietary technology and data to create custom energy solutions
that allow multifamily management to lower their energy usage and save
money. The company distinguishes itself through its knowledgeable and
experienced professionals who provide all services in-house without
outsourcing to other companies. AUM advises energy management of over
500,000 multifamily units across the U.S. For more information on AUM,
please visit www.aum-inc.com
or call 800-418-5393.